• Adam Smith and a Physician’s Pay

    Jan 6 • Thinking Economically • 228 Views

    Pondering healthcare reform again, I came across this comment from Adam Smith, 1776, WEALTH OF NATIONS:

    22] We trust our health to the physician: our fortune and sometimes our life and reputation to the lawyer and attorney. Such confidence could not safely be reposed in people of a very mean or low condition. Their reward must be such, therefore, as may give them that rank in the society which so important a trust requires. The long time and the great expense which must be laid out in their education, when combined with this circumstance, necessarily enhance still further the price of their labour.
    (Book 1, Chapter 10)

    In our Econlife note for December 22, 2009, Uwe E. Reinhardt (Princeton economics professor) discusses doctor pay.
    http://economix.blogs.nytimes.com/2009/07/17/what-is-a-just-physician-income/
    You might also look at:
    http://economix.blogs.nytimes.com/2008/11/14/do-doctors-salaries-drive-up-health-care-costs/
    and

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  • A Rule to Remember?

    Jan 5 • Thinking Economically • 296 Views

    Resembling the disagreement between Paul Krugman and Greg Mankiw on healthcare reform, the debate surrounding the Taylor rule has become somewhat spirited. Yesterday, Ben Bernanke even focused on it during a section of his talk to the American Economic Association.
    http://www.federalreserve.gov/newsevents/speech/bernanke20100103a.htm

    As explained by John Taylor (Stanford and the Hoover Institute)

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  • Econ Humor

    Jan 4 • Thinking Economically • 223 Views

    From Dave Barry in the Washington Post:
    “It was a year of Hope — at first in the sense
    of ‘I feel hopeful!’ and later in the sense of ‘I hope this year ends soon!’”

    “It was also a year of Change, especially in Washington, where the tired old hacks of yesteryear finally yielded the reins of power to a group of fresh, young, idealistic, new-idea outsiders such as Nancy Pelosi…”
    More at…
    http://www.washingtonpost.com/wp-dyn/content/article/2009/12/18/AR2009121802219.html

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  • Working Women

    Jan 3 • Thinking Economically • 206 Views

    A January 3rd article from THE ECONOMIST, “Female Power,” focuses on women in the “rich world”. http://www.economist.com/opinion/displaystory.cfm?story_id=15174418
    For example…
    -More women work. In the U.S. women compose 51% of professional workers.
    -Contraception makes work possible.
    -The “vacuum cleaner” makes work possible.
    -More women work because contemporary jobs require brain power instead of muscle power.
    -The cost of motherhood is high for aspirational women.
    Two thoughts:
    1. With this massive shift in female responsibilities, in nations that prohibit their females from contributing professionally, what will happen to economic growth?
    2. In nations with a substantial female work force, how will families respond? How will a typical U.S family look in 2020?
    Your thoughts?

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  • Cheap Health Care!

    Jan 2 • Thinking Economically • 208 Views

    A recent “Investor’s Business Daily” article includes a great graph. Downward sloping, the graph represents health care spending by consumers. While aggregate spending skyrockets, individuals are paying less out of pocket.
    http://www.investors.com/NewsAndAnalysis/Article.aspx?id=516427
    You see where this is going and what we really need to solve.

    Law of Downward Sloping Demand: When price decreases, consumers are willing and able to spend more. (And when prices rises, the opposite will ocur.)

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